A state losing its appeal

New Jersey's population growth is slowing to a crawl and may one day -- perhaps as early as next year -- stop altogether. So? Fewer people in what is the most densely populated state might not be a bad thing.
A review of the statistics, however, shows decisions by some New Jerseyans to pick up and move elsewhere are having an impact on the state's bottom line.
Rutgers University economists James Hughes and Joseph Seneca found that last year out-migration cost the state an estimated $680 million in sales and income tax revenue. As a percentage of the state's overall revenue, that's not much -- maybe 2 percent or so. Still, it's $680 million that the financially strapped state could have used.

Digging deeper produces even more alarming information. The people moving out generally are richer than those moving in. For example, in 2005, those leaving New Jersey for Florida had incomes on average $30,000 higher than those moving here from the Sunshine State.
What's worrisome is that the trend likely will continue as other states with lower costs of living and of doing business attract more of the high-tech, high-priced jobs that New Jersey once claimed.
The state's policymakers need to enact programs that will give the state an edge in attracting businesses. In a global economy, location alone isn't enough. Companies look for equitable, stable tax policies as well as a diverse and skilled work force.
They also look for areas where their employees can afford to buy houses and pay property taxes. The average income of New Jerseyans is 33 percent higher than the national average. But that advantage is negated by housing costs -- including highest-in-the-nation property taxes -- that are 52 percent higher than the national average.
Last year the Legislature and Gov. Jon Corzine promised that a package of property tax changes they enacted would yield results over a period of years. We remain skeptical. So far the only tangible result has been higher rebate checks this fall. It is unclear whether there's enough money next year to fund that program.
Nothing has been done about increasing state school aid or corralling school costs. Both of those moves would have a significant impact on property taxes. The Corzine administration is promising a new education funding formula shortly.
More than anything, the Hughes-Seneca report is proof that papering over problems from one election to another doesn't work. Eventually, steps must be taken to make New Jersey a place where businesses want to locate and ordinary people can afford to live.